Telematics Service Providers (TSPs) gather vast amounts of data to help fleets manage their vehicles and drivers. For many, it’s a dream to monetize this data and discover new business opportunities. Now, thanks to artificial intelligence (AI), that dream is becoming a reality.
Insurance is an obvious next step for TSPs. They already have the data for thousands, if not tens of thousands, of drivers. They know where their customers drive. They know how often their customers drive. They know why and what their customers drive, and they might know how their customers drive. Pattern AI provides them with deeper insights to not only validate, but to price risk incredibly accurately, resulting in the potential to develop competitive telematics insurance solutions.
For TSPs, raw GPS data is a potential goldmine, and an under explored opportunity for new product development. Pattern AI can enhance the raw GPS data’s value by quantifying it, grading it, and pricing it. Ultimately this provides a transparent view of the entire customer base. An immediate benefit is a greater insight into driver behavior, safety, and sustainability, meeting many corporate social responsibility goals.
Armed with these deeper data insights, TSPs may also choose to explore insurance opportunities. This is made possible by working with an insurance partner to design a competitive, data-driven insurance solution for their target group. Telematics insurance is a win-win-win solution. The insurer obtains new fleet customers at speed, whose risk level they already know. The telematics company retains its fleet customers by offering value-add solutions and an attractive accurately priced insurance offer. And the fleet customer benefits from an insurance solution that is tailored to its needs.
We are already seeing the impact of technology through data-driven insurance solutions. Tesla is a prime example, and probably the best known. The company offers insurance using real-time driving behavior, with no need for an additional device in the vehicle. Tesla users can therefore make monthly payments based on driving behavior, instead of traditional factors such as age, gender, and claim history.
Thanks to AI, many other insurers are offering data-driven, behavior-based products. For example, last year, Greater Than client Tryg Norway launched Sidekick, a smart car insurance offering for drivers aged 18-30. This provides a more flexible alternative for younger car owners who typically face high insurance costs. It also announced it would expand its offering to include EV owners, recognizing that this customer group also suffers from higher insurance costs despite the ecology benefits they deliver to society.
The timing is perfect for telematics companies considering entering the insurance market. TSPs’ end customers need to cut costs. And insurance is one of the biggest financial burdens for fleets. Fleet operators are therefore actively seeking ways to save money, and telematics insurance products can be an attractive consideration.
Fleets are also under increasing pressure to implement safer, more sustainable operations. Data-driven insurance solutions that incentivize safer driving behaviors are powerful tools to help them achieve this.
For TSPs, the step into motor insurance can be easy. With Greater Than’s support, TSPs can quickly monetize their GPS telematics data. This is because our AI can deliver a deeper layer of insights to verify risk, and assign a precise price to it.
These data insights can enable dynamic telematics insurance solutions that recognize safe, eco-friendly driving. A TSP that delivers such a solution adds value to its customers by lowering insurance costs and increasing driver safety. At the same time, the customer relationship is strengthened, and client retention is encouraged. It’s easy to see why insurance is a desirable next step for telematics companies.